Hong Kong stocks, which had been in the doldrums for a long time, finally performed yesterday, with the Hang Seng index rising 3.36 per cent. Hong Kong equity funds performed strongly. A number of investors said that with the rapid repair of market risk appetite and the expectation of accelerating the return of Chinese stocks to Hong Kong listing, Hong Kong stocks with ultra-low valuations may usher in investment opportunities.

Benefiting from the sharp rise in Hong Kong stocks, the net value of funds investing in the Hong Kong market or secondary market prices have taken advantage of the upward trend. The performance of Hong Kong stock market funds is eye-catching. The Dacheng Hang Seng Index Fund rose 7.06% yesterday, Cathay Pacific Hang Seng Hong Kong Stock Connect also rose 6.63%, and Huidianzhong Securities Hong Kong Stock Connect High dividend A rose 4.23%. Huaxia Hong Kong Stock Connect and Guangfa Hong Kong Stock Connect Hang Seng An are all up more than 4%. Hang Seng ETF also performed well, with Huaxia Hang Seng ETF and Yi Fang Da Hang Seng H-share ETF up 3.16 per cent and 3.04 per cent respectively, while Southern Hang Seng ETF and Huaxia Shanghai-Hong Kong Stock Connect Hang Seng ETF rose 3 per cent and 2.65 per cent respectively.

Yesterday, the Shanghai-Hong Kong Stock Connect showed net buying in both directions, with a net inflow of about 11.9 billion yuan northward, a net purchase of 4.642 billion yuan for Shanghai stocks and a net purchase of 7.307 billion yuan for Hong Kong stocks, a high for short-term inflows. Since late March, foreign capital has accelerated its return to A-shares. Last week, the net inflow of northbound capital reached 15.245 billion yuan, the highest in nearly six weeks, and the continuous net inflow reached 10 weeks.

Recently, there has been a significant increase in the size of Hong Kong stock ETF. Data show that since the low of the Hang Seng Index on March 19, Huaxia Hang Seng's ETF share has increased by nearly 800m shares, and Yi Fangda Hang Seng H shares ETF Link C has increased by nearly 200m shares.

The Wells Fargo Fund believes that the rise in Hong Kong stocks is on the one hand due to the fact that the early market is facing a double "headwind" of both capital and emotional aspects, resulting in a larger correction, and the valuation of the Hang Seng Index has fallen back to an all-time low level. The suitability of valuation profits continues to attract overseas and mainland capital inflows. The national two sessions were held, the meeting set the tone to quickly repair the market risk appetite, valuation repair expectations continue to rise, Hong Kong stocks were in a positive mood yesterday, trading volume significantly enlarged. On the other hand, economic restart is still the main line, after the National two sessions, the focus of market attention continues to shift to fundamentals. As the importance of fundamental improvement to the market is increasing step by step, the Hong Kong stock market will also further focus on internal stable development.

The Wells Fargo Fund said that Chinese stocks have set off a wave of return, the new economy of Hong Kong stocks has ushered in "source running water", the attractiveness of allocation is expected to further increase, and positive structural expectations for Hong Kong stocks will be maintained in the medium to long term.

Xu Tingquan, fund manager of HSBC Jinxin Hong Kong Stock Exchange Select Fund, said that the epidemic is gradually improving, the United States has not proposed further prohibitions on Huawei and its chip design companies, there is still room for negotiation between China and the United States, and uncertainty has eased somewhat. Market sentiment has been boosted. Domestic substitute beneficiary enterprises have better growth potential, and are optimistic about the growth momentum brought by the replacement demand, penetration promotion and infrastructure construction in the process of 5G upgrade. At the same time, we continue to be optimistic about the continuous improvement of operations such as Internet platforms related to life services and online and offline integrated retailers. For Hong Kong local stocks, they are more cautious in the short term and focus on potential risks in the near future, although some stocks are already relatively cheap and will remain relatively underpriced for the time being.

GF Securities Co., LTD. said that factors such as the short-term external situation will dampen investor sentiment in Hong Kong stocks. The risk of long tail of the epidemic still exists after the resumption of work in Europe and the United States, coupled with the impact of low oil prices, we need to pay attention to the risk of overseas volatility caused by debt default "stress tests", economic recession and earnings revision.

With regard to the future trend of Hong Kong stocks, GF Securities Co., LTD. believes that in the medium and long term, the advantages of low earnings expectations and extremely low valuations of Chinese capital stocks in Hong Kong stocks, coupled with their "immunity" to debt risks, will enhance their independence in the future market fluctuations. Under the expectation of the return of Chinese stocks, high-quality "scarce assets" of Hong Kong stocks, such as Internet software, is the key allocation direction. And the early strong performance of the epidemic "low sensitivity" sector, in the short term may face the risk of falling.